Abstract
This chapter presents an exploratory investigation of emerging corporate political perspectives of intra-African foreign direct investment (FDI). Using an exploratory, qualitative, multi-case-study research approach, the investigation drew on evidence from Uganda’s pro-market reformed electricity industry. The methods of data collection were primarily semi-structured interviews and examination of archival materials, while data analysis was thematic. Some indications emerge of how investment patterns on the continent are increasingly being shaped by firms that heterogeneously deploy corporate political activity (CPA) strategies. The nature of the political capabilities associated with this heterogeneity suggests a growing consciousness by firms to better align their classical market strategies with non-market strategies. There is also an indication that a strategic accumulation of heterogeneous political capabilities by home-grown emerging market multinational enterprises (EMNEs) positions them to capture a bigger share of the African market in future and to drive intra-African FDI. Finally, there is some evidence of an emerging African interpretation of market capitalism that is rooted in the contingencies and the aspirations of the continent. All this bodes well for Africa as one of the final frontiers of large-scale FDI.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
References
Adeleye, I., Ibeh, K., Kinoti, A., & White, L. (2015). The changing dynamics of international business in Africa, AIB Sub-Saharan Africa (SSA) Series (Vol. 1). London: Palgrave Macmillan.
Bacon, R., & Besant-Jones, J. (2001). Global electric power reform, privatization, and liberalization of the electric power industry in developing countries 1. Annual Review of Energy and the Environment, 26(1), 331–359.
Bacon, R. W. (1995). Privatization and reform in the global electricity supply industry. Annual Review of Energy and the Environment, 20(1), 119–143.
Baines, P. R., & Viney, H. (2010). The unloved relationship? Dynamic capabilities and political-market strategy: A research agenda. Journal of Public Affairs, 10(4), 258–264.
Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99.
Bartels, F. L., Alladina, S. N., & Lederer, S. (2009). Foreign direct investment in Sub-Saharan Africa: Motivating factors and policy issues. Journal of African Business, 10(2), 141–162.
Baysinger, B. D. (1984). Domain maintenance as an objective of business political activity: An expanded typology. Academy of Management Review, 9(2), 248–258.
Bigsten, A., & Durevall, D. (2003). Globalisation and policy effects in Africa. World Economy, 26(8), 1119.
Bonardi, J. P. (2011). Corporate political resources and the resource-based view of the firm. Strategic Organization, 9(3), 247–255.
Bonardi, J.-P., & Keim, G. D. (2005). Corporate political strategies for widely salient issues. The Academy of Management Review, 3, 555–576.
Bremmer, I. (2009). State capitalism comes of age: The recent wave of state intervention in emerging-market countries, a reaction to the current global recession, signals that the free-market tide has receded. Foreign Affairs-New York, 88(3), 40–55.
Businge, J. (2014) Universal access to electricity [Online]. Kampala. Retrieved August 25, 2014, from http://www.independent.co.ug/news/news/9195-universal-access-to-energy-will-spur-economic-growth-wwf-
Crittenden, V. L., & Crittenden, W. F. (2010). Strategic management in emergingeconomies: A research agenda. Organizations & Markets in Emerging Economies, 1(1), 9–23.
Crotty, M. (1998). Introduction: The research process, The foundations of social research: Meaning and perspective in the research process. London: Sage Publications.
Cuervo-Cazurra, A. (2006). Who cares about corruption? Journal of International Business Studies, 37(6), 807–822.
Cuervo-Cazurra, A. (2008). The multinationalization of developing country mnes: The case of multilatinas. Journal of International Management, 14(2), 138–154.
Dahan, N. (2005). Can there be a resource-based view of politics?. International Studies of Management & Organization, 35(2), 8–27.
Daniel, J., Naidoo, V., & Naidu, S. (2003). The South Africans have arrived: Post-apartheid corporate expansion into Africa. State of the nation: South Africa, 2004, 368–390.
Dieleman, M., & Sachs, W. M. (2008). Coevolution of institutions and corporations in emerging economies: How the salim group morphed into an institution of suharto’s crony regime. Journal of Management Studies, 45(7), 1274–1300.
Dimaggio, P. J., & Powell, W. W. (1983). The iron cage revisited: Institutional isomorphism and collective rationality in organizational fields. American Sociological Review, 48(2), 147–160.
Doh, J. P., Lawton, T. C., & Rajwani, T. (2012). Advancing nonmarket strategy research: Institutional perspectives in a changing world. Academy of Management Perspectives, 26(3), 22–39.
Dyer, W. G., & Wilkins, A. L. (1991). Better stories, not better constructs, to generate better theory: A rejoinder to eisenhardt. Academy of Management Review, 16(3), 613–619.
Easterby-Smith, M., Thorpe, R., & Jackson, P. R. (2008). Management research. London: Sage.
Eisenhardt, K. M. (1989). Building theories from case study research. Academy of Management Review, 14(4), 532–550.
Engurait, S. P. (2005). Power sector reforms in Uganda: Status and achievements. International Journal of Global Energy Issues, 23(2), 110–118.
Frynas, J. G., Mellahi, K., & Pigman, G. A. (2006). First mover advantages in international business and firm-specific political resources. Strategic Management Journal, 4, 321.
Goodstein, J. D., & Velamuri, S. R. (2009). States, power, legitimacy, and maintaining institutional control: The battle for private sector telecommunication services in Zimbabwe. Organization Studies, 30(5), 489–508.
Grant, R. (1998). Contemporary strategy analysis. Oxford, UK: Blackwell Publishers Ltd.
Grant, R. M. (2003). Strategic planning in a turbulent environment: Evidence from the oil majors. Strategic Management Journal, 24(6), 491.
Greenwood, R., & Suddaby, R. (2006). Institutional entrepreneurship in mature fields: The big five accounting firms. Academy of Management Journal, 49(1), 27–48.
Haanyika, C. M. (2006). Rural electrification policy and institutional linkages. Energy Policy, 34(17), 2977–2993.
Hammersley, M., & Atkinson, P. (2007). Ethnography: Principles in practice (3rd ed.). New York: Routledge.
Helfat, C. E., & Peteraf, M. A. (2003). The dynamic resource-based view: Capability lifecycles. Strategic Management Journal, 24(10), 997–1010.
Henisz, W. J., & Zelner, B. A. (2010). The hidden risks in emerging markets. Harvard Business Review, 88(4), 88–95.
Hill, C. W., Hwang, P., & Kim, W. C. (1990). An eclectic theory of the choice of international entry mode. Strategic Management Journal, 11(2), 117–128.
Hillman, A. J., & Hitt, M. A. (1999). Corporate political strategy formulation: A model of approach, participation, and strategy decisions. The Academy of Management Review, 4, 825.
Hillman, A. J., Keim, G. D., & Schuler, D. (2004). Corporate political activity: A review and research agenda. Journal of Management, 30(6), 837–857.
Hoskisson, R. E., Eden, L., Lau, C. M., & Wright, M. (2000). Strategy in emerging economies. Academy of Management Journal, 43(3), 249–267.
Jackson, D., & Deeg, R. (2008). From comparing capitalisms to the politics of institutional change. Review of International Political Economy, 15(4), 680–709.
Jamasb, T. (2006). Between the state and market: Electricity sector reform in developing countries. Utilities Policy, 14(1), 14–30.
Karekezi, S., & Kimani, J. (2002). Status of power sector reform in Africa: Impact on the poor. Energy Policy, 30(11–12), 923–945.
Keating, M. F. (2009). Global best practice (s) and electricity sector reform in Uganda. Coventry: University of Warwick: Centre for the Study of Globalisation and Regionalisation (CSGR).
Khanna, T., Palepu, K. G. & Sinha, J. (2005). Strategies that fit emerging markets. Harvard Business Review, 83(6), 4–19.
Khoury, T. A., & Prasad, A. (2012). How do developing country entrepreneurs navigate extreme institutional voids?, Academy of Management Annual Meeting Proceedings, 1–1.
Lawton, T., Doh, J. P., & Rajwani, T. (2014). Aligning for advantage—Competitive strategies for the political and social arenas. Oxford: Oxford University Press.
Lawton, T., Rajwani, T., & Doh, J. (2013). The antecedents of political capabilities: A study of ownership, cross-border activity and organization at legacy airlines in a deregulatory context. International Business Review, 22, 228–242.
Li, M. H., Cui, L., & Lu, J. (2014). Varieties in state capitalism: Outward fdi strategies of central and local state-owned enterprises from emerging economy countries. Journal of International Business Studies, 45(8), 980–1004.
Linaweaver, S. (2003). Catching the boomerang: Em, the world bank, and excess accountability: A case study of the bujagali falls hydropower project uganda. The International Journal of Sustainable Development & World Ecology, 10(4), 283–301.
Luiz, J. M., & Ruplal, M. (2013). Foreign direct investment, institutional voids, and the internationalization of mining companies into Africa. Emerging Markets Finance and Trade, 49(4), 113–129.
Luo, Y. (2004). A coopetition perspective of MNC–Host government relations. Journal of International Management, 10(4), 431–451.
Luwa, K. J. (2007). Power and development: Controversies over the bujagali hydropower porject along the nile river in uganda. Karlstad University.
Maestad, O. (2003). The electricity sector in Uganda—Results of development assistance. Bergen, Norway: Institute for Research in Economics and Business Administration (SNF).
Magnusson, P., Westjohn, S. A., Gordon, G. L., & Aurand, T. W. (2012). Environmental dynamics and first-mover advantages in emerging markets. Marketing Management Journal, 22(1), 17–34.
Mawejje, J., Munyambonera, E., & Bategeka, L. (2012). Uganda Electricity Sector Reforms and Institutional Restructuring. Economic Policy Research Centre Research Series, 89.
Mcdonald, D. (Ed.) (2009). Electric capitalism: Recolonising Africa on the power grid. Cape Town: HSRC Press.
Meru, A. K., & Struwig, M. (2011). An evaluation of the entrepreneurs’ perception of business-incubation services in Kenya. International Journal of Business Administration, 2(4), 112.
Meru, A. K., & Struwig, M. (2015). Business-incubation process and business development in Kenya: Challenges and recommendations. Journal of Entrepreneurship and Innovation in Emerging Economies, 1(1), 1–17.
Miles, M. B., & Huberman, A. M. (1994). Qualitative data analysis: An expanded sourcebook. Thousand Oaks, CA: Sage Publications.
Ministry of Natural Resources (1997). Strategic plan for the Uganda power sector. Kampala, Uganda: Government of tue Republic of Uganda.
Ndikumana, L., & Nannyonjo, J. (2007). From failed state to good performer? The case of Uganda. In J. K. Boyce & M. O’donnell (Eds.), Peace and the public purse: Economic policies for postwar statebuilding, Center on International Cooperation Studies in Multilateralism (pp. 15–54). Lynne Rienner: London.
Nölke, A., & Vliegenthart, A. (2009). Enlarging the varieties of capitalism: The emergence of dependent market economies in east central europe. World Politics, 61(04), 670–702.
Oliver, C., & Holzinger, I. (2008). The effectiveness of strategic political management: A dynamic capabilities framework. Academy of Management Review, 33(2), 496–520.
Pender, J. (2001). From ‘structural adjustment’ to ‘comprehensive development framework’: Conditionality transformed? Third World Quarterly, 22(3), 397–411.
Peng, M. W., Wang, D. Y. L., & Yi, J. (2008). An institution-based view of international business strategy: A focus on emerging economies. Journal of International Business Studies, 39(5), 920–936.
Prahalad, C. K., & Hamel, G. (1990). The core competence of the corporation. Harvard Business Review, 3, 75–91.
Rahman, Z., & Bhattacharyya, S. (2003). Sources of first mover advantages in emerging markets–An indian perspective. European Business Review, 15(6), 359–369.
Raman, A. P. (2009). The new frontiers. Harvard Business Review, 87(7/8), 130–137.
Robinson, M. (2007). The political economy of governance reforms in Uganda. Commonwealth & Comparative Politics, 45(4), 452–474.
Scott, R. W. (2001). Institutions and organizations. Thousand Oaks, CA: Sage Publications.
Scott, W. R. (1987). The adolescence of institutional theory. Administrative Science Quarterly, 32(4), 493–511.
Scott, W. R. (1995). Organizations and institutions. Thousand Oaks, CA: Sage.
Shaw, T. M., & Nyang’oro, J. E. (2000). African renaissance in the new millennium? From anarchy to emerging markets? African Journal of Political Science/Revue Africaine de Science Politique, 5(1), 14–28.
Stal, E., & Cuervo-Cazurra, A. (2011). The investment development path and fdi from developing countries: The role of pro-market reforms and institutional voids. Latin American Business Review, 12(3), 209–231.
Sun, P., Mellahi, K., & Thun, E. (2010). The dynamic value of mne political embeddedness: The case of the chinese automobile industry. Journal of International Business Studies, 41(7), 1161–1182.
Tumwesigye, R., Twebaze, P., Makuregye, N., & Muyambi, E. (2012). Key issues in Uganda's energy secor. London: Pro-Biodiversity Conservationists in Uganda (PROBICOU)/International Institute for Environment and Development.
Unctad. (2011). World investment report 2011. Non-equity modes of international production and development. New York, USA: United Nations Publications.
Unctad. (2014). World investment report 2014. Investing in the sdgs: An action plan. New York, USA: United Nations Publications.
Wallis, W. (2014). Failure of political systems is biggest threat to African renaissance. Financial Times, October 05, 2014.
Webb, J. W., Kistruck, G. M., Ireland, R. D., & Ketchen, J. D. J. (2010). The entrepreneurship process in base of the pyramid markets: The case of multinational enterprise/nongovernment organization alliances. Entrepreneurship: Theory & Practice, 34(3), 555–581.
Weidenbaum, M. L. (1980). Public policy: No longer a spectator sport for business. Journal of Business Strategy, 1(1), 46.
Weik, E. (2011). Institutional entrepreneurship and agency. Journal for the Theory of Social Behaviour, 41(4), 466–481.
World Bank. (2012). Uganda: Country brief [Online]. Washington, DC. Retrieved November 16, 2012, from http://www.worldbank.org/en/country/uganda
World Bank. (2014). Access to electricity [Online]. Washington, DC. World Bank. Retrieved August 25, 2014, from http://data.worldbank.org/indicator/EG.ELC.ACCS.ZS/countries/UG-ZF-XM?display=graph
Yin, R. (2003). Case study research: Design and methods. Thousand Oaks, CA: Sage Publications.
Zhao, M., Tan, J., & Park, S. H. (2013). From voids to sophistication: Institutional environment and MNC CSR crisis in emerging markets. Journal of Business Ethics, 122(4), 655–674.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2016 The Author(s)
About this chapter
Cite this chapter
Mbalyohere, C.G. (2016). Corporate Political Activity and Intra-African Foreign Direct Investments: Evidence from Uganda’s Electricity Industry. In: Adeleye, I., White, L., Boso, N. (eds) Africa-to-Africa Internationalization. AIB Sub-Saharan Africa (SSA) Series. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-30692-6_4
Download citation
DOI: https://doi.org/10.1007/978-3-319-30692-6_4
Published:
Publisher Name: Palgrave Macmillan, Cham
Print ISBN: 978-3-319-30691-9
Online ISBN: 978-3-319-30692-6
eBook Packages: Business and ManagementBusiness and Management (R0)